Center for Non-Profits - Letter to Sen. Bond Regarding VA-HUD Appropriation

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Text of Letter Sent to Senator Christopher Bond Regarding Federal VA-HUD Appropriation and Proposed Non-Profit Advocacy Restrictions
(Posted 9/24/99)

September 24, 1999

The Honorable Christopher S. Bond
Chair, Senate Appropriations Subcommittee on VA-HUD and Independent Agencies
127 Dirksen Senate Office Building
Washington, DC 20510

Re: Non-profit Lobbying/Advocacy Restrictions in the Senate VA-HUD Appropriations Bill (S.1596)

Dear Senator Bond:

On behalf of the Center for Non-Profit Corporations, I am writing to express deep concern regarding two provisions in the VA-HUD appropriations bill (S.1596) that would restrict the public policy and litigation activities of non-profit organizations beyond those in current law. The Center for Non-Profit Corporations is a charitable umbrella organization providing technical assistance, advocacy, public education, research and cost-saving programs for New Jersey's charitable non-profit community, including 600 members. Our members represent a broad spectrum of charitable activity, including human services, arts and culture, housing, community development, faith-based organizations, environmental protection, health care, and many others.

We understand that Section 425 has been modified to conform to current law, and we thank you for agreeing to amend that section. However, we remain extremely worried about two provisions that are still in the bill:

Section 430
As you know, existing federal laws and regulations already prohibit the use of federal funds for lobbying, except in very narrowly defined circumstances. Section 430 would greatly expand this restriction by banning the use of federal funds appropriated under the covered departments "for any activity or the publication or distribution of literature that in any way tends to promote public support or opposition to any legislative proposal on which congressional action is not complete." We have seen no evidence of abuse of the current laws that would justify such a dramatic expansion. This language is so vague and sweeping that it could be interpreted to apply to virtually any communication or research produced or distributed in whole or in part with funds originating from any of the government agencies covered under this appropriation. Additionally, it sets a dangerous precedent that would undoubtedly have a "chilling effect" on the activities of non-profits overall - even those that are not funded by the covered agencies. Consider the following examples:

Here in New Jersey, the local Red Cross and many other organizations are engaged in an extensive relief effort for the victims of Hurricane Floyd. The devastation, and their activities to alleviate it, are common knowledge throughout the state, as is the role FEMA plays in the recovery operation. FEMA, of course, is one of the agencies funded under the S.1596 appropriation. Are these heroic organizations breaking the law by speaking to the media about the victims' losses and their cooperative work with FEMA - or even by conducting private fund raising for their efforts? Are local housing organizations jeopardizing their regular HUD grants by providing emergency construction assistance during the relief effort?
A small non-profit regularly conducts testing in the waterways in its community, with funds originating from the EPA. Its latest series of tests of a nearby canal reveals a disturbing rise in pollutants, and it publicizes those results in the community and the media. Meanwhile, in Washington, DC, Congress is considering the annual appropriation for the EPA, as well as a measure that would toughen water pollution laws against businesses. An educated citizen could easily see a connection between the local water quality and the measures pending before Congress, even if the non-profit made no mention of any of the federal proposals. Did the non-profit cross the line?

Because Section 430 contains no clear definition of what kind of activity is covered, charitable organizations could be severely hampered in the pursuit of their missions. Furthermore, because of the nature of the Congressional process, legislation and legislative proposals are often pending in Congress for many months, if not an entire 2-year session. Often initiatives, particularly on complicated, controversial or intractable issues, are re-introduced session after session, meaning that Congressional action on such items is never "complete." An unintended - and especially frightening - irony of Section 430 is that it could effectively silence those organizations with the most expertise (and therefore, the most to contribute) from the public debate about these issues.

EPA Administrative Restriction
Under the bill, a 501(c)(3) organization would have to certify that it had not used federal funds to engage in litigation against the United States Government, or forego eligibility for EPA funding. It is unclear to us why charities alone, and not trade associations or for-profit businesses and other entities, are being targeted for this restriction. Nevertheless, this provision poses a number of problems. Its penalty - a permanent debarment from receiving EPA grants or contracts - is particularly severe and carries no "statute of limitations." Thus, an organization that legally engaged in litigation 25 years ago would be ineligible for EPA funding today under this bill. This provision contains no exception for organizations that engage in litigation under express statutory direction from the Federal government (e.g., the Developmental Disabilities Act). Because of the existing restrictions on litigation contained in OMB Circular A-122, and because Section 425 already prohibits the use of federal funds by grantees to initiate litigation against the U.S. government, we believe that the EPA restriction is unnecessary and could create excessive administrative burdens for non-profits.

The charitable community has a long tradition of working in partnership with government to identify and address public needs. This relationship depends upon the ability of both partners to exchange information, ideas and recommendations freely. Each of these restrictions would significantly hamper efforts to build and sustain these vital public/private partnerships. They would pose unintended, severe consequences on non-profit groups, and would effectively stifle their ability to communicate on behalf of some of society's most vulnerable people.

We again thank you for agreeing to amend Section 125, and respectfully urge you to withdraw both of the remaining provisions. If you need additional information, please feel free to contact me.

Thank you for your consideration.

Sincerely,

Linda M. Czipo
Vice President

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